Oct 17, 2022•3 min read
GameFi (Gaming and Finance) which refers to blockchain games is sharply increasing and gaining mass recognition. According to DappRadar, games and metaverse projects have successfully raised north of $2.5 billion. Even in the bear market, they have grown by over 2000% by 2021 and over 50% constitution in all blockchain activities. The statistics demonstrate their rapid development and rising adoption.
Let’s have a look at the current gamefi market and how it will develop in the future.
The current blockchain gaming market is over $8 billion and it is predicted to grow to more than $50 billion by 2025 (data from Crypto.com). Thus, gamefi will potentially be an explosion in the upcoming years.
The presence of blockchain gaming is pulling the definition of “crypto” closer to the community and has received mass adoption. As stated by Chainplay’s State of Gamefi 2022 survey, at least 75% of gamefi investors initiated their crypto investments once taking part in gamefi ecosystems. Thanks to blockchain technology, people can gain benefits from gaming, particularly:
1. Blockchain offers players full control of their assets
In blockchain play-to-earn (P2E) games, players can wholly own their acquired assets throughout the game and sell them on secondary markets. It displays their ownership of proof of authenticity of in-game items. This benefit is an upgrade compared to traditional games where users are allowed to use their in-game assets but cannot sell them on in-game or secondary markets for real money.
2. GameFi brings a new game-based economic model
GameFi uses blockchain, cryptocurrencies, NFTs, and the play-to-earn model to lay the economic foundations of the game. NFTs or in-game assets can be acquired in multiple ways depending on the game and be sold in various NFT marketplaces.
Further, gamefi industry provides an opportunity to create virtual jobs in an emergent market. Let’s take the Philippines as an example, its people found a way to make an extra income playing Axie Infinity which is the most popular P2E game on the Ethereum blockchain.
3. Potential investment opportunities
With successful fundraising, quality growth, and a vibrant community of gamefi and crypto, they are expressing their potential and attracting a large number of investors and VCs.
According to DappRadar, web3 games and metaverse projects raised nearly $750 million in funds in August — a 135% increase from July. A leading investor, Andreessen Horowitz from a16z also invested $4.6 million in a game guild for upcoming game activities. Besides, an important player Sam Bankman-Fried’s crypto exchange FTX has just announced a gaming unit as a crypto-as-a-service platform to support mainstream crypto adoption.
Gamefi is expected to be a new era in the gaming industry and sharply increase 6.5 times by 2025 compared to this year (data from Crypto.com). It is receiving mainstream adoption and reaching mass consumers. It can totally draw a large swathe of traditional players, gamers, and even newcomers without gaming knowledge.
However, gamefi has currently faced several challenges which encounter it from expanding to diverse communities:
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